<p>The market is still trading based
on the “soft landing” narrative as inflation moderates and the labour market
remains tight for the Nasdaq Composite. Yesterday, the market once again cheered on the release of the <a target=“_blank“ href=“https://www.forexlive.com/news/us-employment-cost-index-for-q4-10-vs-11-estimate-20230131/“ target=“_blank“ rel=“follow“>Employment
Cost Index (ECI) for Q4</a>, which missed expectations and pushed back
further on the fears of a wage price spiral. </p><p>In fact, we’ve been seeing
moderation in wage growth for months and this should be a welcome news for
the Fed as that’s one of the biggest worries they had. Today there’s the <a target=“_blank“ href=“https://www.forexlive.com/centralbank/the-newsquawk-fomc-preview-20230201/“ target=“_blank“ rel=“follow“>FOMC
Policy Announcement</a> where the Fed is expected to hike by 25 bps
followed by Fed Chair Powell Press Conference where he’s expected to sound
hawkish. </p><p>Given that the market has already
priced in such outcomes, it’s unlikely to see very big moves and we should get back to trading
economic data on Friday when the NFP report gets released. </p><p>Nasdaq Composite Technical Analysis</p><p>On the daily chart above, we can
see that the price managed to reach the top of the range. This <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>resistance</a> hasn’t been broken since
September 2022 and the bulls will need a good catalyst to target new highs. In
case the bullish sentiment continues, the next targets are the resistance at
the 12274 and the resistance at 13191. </p><p>On the other hand, if the price
fails to keep the bullish momentum going, the bears may regain control and
target the bottom of the range at 10200.</p><p>On the 1 hour chart above, we can
see that the price is trading in a rising channel with the near term <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>support</a> at 11399, which has also the
bottom of the channel as further confluence. If the bears manage to break
below that zone, they should have the upper hand and target the support at
10200. </p><p>Drilling down to the 15 minutes
chart above, we can see that the price is now right within the resistance area
at 11500 and 11600. The price action may be choppy today as we head into the
FOMC Policy Announcement. </p><p>Before that we have other
important economic reports with the ISM Manufacturing PMI and US JOLTs at the
top of the list. The levels are defined though: stay above 11689 and the
bulls are in control, on the other hand, get below 11399 and the bears will
regain control. </p>
on the “soft landing” narrative as inflation moderates and the labour market
remains tight for the Nasdaq Composite. Yesterday, the market once again cheered on the release of the <a target=“_blank“ href=“https://www.forexlive.com/news/us-employment-cost-index-for-q4-10-vs-11-estimate-20230131/“ target=“_blank“ rel=“follow“>Employment
Cost Index (ECI) for Q4</a>, which missed expectations and pushed back
further on the fears of a wage price spiral. </p><p>In fact, we’ve been seeing
moderation in wage growth for months and this should be a welcome news for
the Fed as that’s one of the biggest worries they had. Today there’s the <a target=“_blank“ href=“https://www.forexlive.com/centralbank/the-newsquawk-fomc-preview-20230201/“ target=“_blank“ rel=“follow“>FOMC
Policy Announcement</a> where the Fed is expected to hike by 25 bps
followed by Fed Chair Powell Press Conference where he’s expected to sound
hawkish. </p><p>Given that the market has already
priced in such outcomes, it’s unlikely to see very big moves and we should get back to trading
economic data on Friday when the NFP report gets released. </p><p>Nasdaq Composite Technical Analysis</p><p>On the daily chart above, we can
see that the price managed to reach the top of the range. This <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>resistance</a> hasn’t been broken since
September 2022 and the bulls will need a good catalyst to target new highs. In
case the bullish sentiment continues, the next targets are the resistance at
the 12274 and the resistance at 13191. </p><p>On the other hand, if the price
fails to keep the bullish momentum going, the bears may regain control and
target the bottom of the range at 10200.</p><p>On the 1 hour chart above, we can
see that the price is trading in a rising channel with the near term <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“ target=“_blank“ rel=“follow“>support</a> at 11399, which has also the
bottom of the channel as further confluence. If the bears manage to break
below that zone, they should have the upper hand and target the support at
10200. </p><p>Drilling down to the 15 minutes
chart above, we can see that the price is now right within the resistance area
at 11500 and 11600. The price action may be choppy today as we head into the
FOMC Policy Announcement. </p><p>Before that we have other
important economic reports with the ISM Manufacturing PMI and US JOLTs at the
top of the list. The levels are defined though: stay above 11689 and the
bulls are in control, on the other hand, get below 11399 and the bears will
regain control. </p>
This article was written by ForexLive at www.forexlive.com.